NEWS
News in brief . . .
Reebok and Skechers take the U.S. toning boom to Europe (see report on page 22 ), but MBT and others should benefit
Garant posts better results than expected Better margins and growing sales at Tod's LVMH wins a partial victory against Google Shoe Carnival exceeds expectations for quarter
Industry brief
The Federation of European Sporting Goods Industry (Fesi) has taken its opposition to the European Union’s anti-dumping duties on leather shoes to the European General Court. Fesi claims that the EU did not properly investigate or analyze the facts before it extended the duties for another 15 months in December. It asserts that the duties hurt European businesses and consumers. Fesi estimates that since the duties were established in 2006, they have taken ¤1 billion. As previously reported, China has asked the World Trade Organization to look at the issue.
The British footwear retailer L.K. Bennett is rumored to be working on expanding beyond its home market. Its sales for the fiscal year ended Aug. 1, 2009 jumped by 18 % to £67.2 million (¤76.2m- $102.2m), though pre-tax profits fell slightly to £9.6 million (¤10.9m-$14.6m), a 2 % decrease. The company is owned by Phoenix Equity Partners and Sirius Equity.
Just Cubes is the name of a new shoe show being organized by Messe Düsseldorf at the same time as its CPD fashion fair from July 24-26. It will be largely inspired by the successful White Cubes space at the GDS.
The global footwear market is expected to hit $232.1 billion in 2013, which would be growth of 18.1 % since 2008, according to a report from Research and Markets based in Dublin
MBT’s founder explores new horizons
Karl Müller, the Swiss mechanical engineer who launched Masai Barefoot Technology (MBT) in 1996 and sold it 10 years later to an American investment fund, is about to launch a totally new footwear concept under the umbrella of his holding company, Karl Müller Science Footwear. He declined to elaborate. The 58-year-old executive and his 25-year-old son, who has the same name as his father, are already making strides with three other product lines – Joya, Joysy and Kybun – launched after the sale of MBT. The Müllers are going to sell about 200,000 pairs of Joya shoes this year. Joya is a derivative of MBT’s original concept of physiological footwear. This type of walking shoe uses four different insoles to provide a unique “joyful” sensation. The line has been complemented by an integratedActive Airpump, which creates a microclimate around the foot. Joysy is the children’s version of the Joya concept. Kybun is a more comprehensive concept that encompasses shoes without an outsole as well as gym mats, treadmills and, potentially, other products based on the application of automation techniques to biomechanics. Karl Müller senior has his own factory in the Montebelluna area producing 4,000 pairs of shoes a month on an experimental basis, with the help of robots. The production is going to be transferred to a larger factory in Switzerland later this year. The shoes made with this system have been marketed for the moment only in Switzerland, but they have just started to be sold also in Austria.
4 • FOOTWEAR TODAY
•MAY 2010
MBT hopes to benefit from the expansion of the toning shoe market
“MBT congratulates the other brands that join our revolution,” says an advertisement that has been running in some trade publications over the last few weeks. Officials of MBT are in fact convinced that the entry of heavyweights such as Skechers and Reebok into the category can only benefit their company as it strives to maintain its unique positioning and its broad reputation as the first and the best in the growing physiological footwear market. MBT had been used to strong double-digit sales increases in the past, and
the new competition has seemingly slowed down its growth by offering different looks and strongly marketed alternatives at lower price points. According to MBT, their moves have increased the size of the pie by raising consumers’ awareness about the benefits that toning shoes can provide for the body, but the resulting segmentation of the market should lead more and more consumers to opt for the authentic supplier that can offer the highest guarantees of quality. The new competition has led MBT to develop better and less-casual looks,
like some of the formal men’s shoes and the fancy women’s leather boots that the company has introduced for the fall/winter 2010-11 season. A German fashion designer, Wolfgang Joop, has created a special line for MBT stores. While the average MBT shoe costs ¤250, its collection now includes models priced at up to ¤350 a pair. Company officials also point out that MBT is certified by Gore-Tex and that
its shoes can now be worn without a problem for 24 hours in a row – a claim that they could not make before. They note that MBT continues to spend 3 million CHF (¤2.1m-$2.8m) annually on its MBT Academy, where 25 people are involved in R&D. The company is capitalizing on the development of MBT stores through its
best retail partners, following a new concept presented at the GDS trade show last month. It had originally planned to make its presentation to only about 25 retailers during the show, but in the end about 100 people signed up for the event, requiring the allocation of a larger surface at the last minute. Excluding about 160 stores in South Korea, which are still managed by
MBT’s founder, Karl Müller , MBT has about 150 partner stores around the world. These stores represent about half of its sales in Switzerland. There are four of them in Italy, others are planned at major locations in Milan, Paris and other cities.
Tod’s continues to improve comparable store sales
Sales continue to improve on a comparable basis at the stores that are directly operated by the Tod’s group. They rose by 0.7 % in the first 10 weeks to March 7. For the whole of 2009, same-store sales fell by 0.2 % but were more sustained during the latter part of the year. Releasing its final annual results, the company reported better than
expected operating results while confirming that its revenues rose by 0.8 % to ¤713.1 million from ¤707.6 million, as announced on Jan. 27. Tod’s ended the year with an operating profit before depreciation and amortization (Ebitda) of ¤158.7 million, beating the expectations of financial analysts who had forecast a figure slightly above ¤156 million, compared with ¤155.6 million a year earlier. The group thus succeeded in increasing its Ebitda margin to 22.3 % of sales from 22.0 % in 2008, when the margin slipped as sales rose faster than gross earnings.
www.shoeintelligence.com
www.footweartoday.co.uk
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